Which Statement Is NOT True Regarding Emerging Markets

question 47

Multiple Choice

Which statement is NOT true regarding emerging markets?

• A) Emerging market financial institutions have generally proven to be weaker than those in industrialized countries.
• B) Emerging markets are the capital markets of poorer, developing countries that have liberalized their financial system to allow private asset trade with foreigners.
• C) Countries with emerging markets include Brazil, Mexico, and Thailand.
• D) Countries with emerging markets have been unable to liberalize their financial systems to allow private trade with foreigners.
• E) Emerging market financial institutions contributed to the financial crisis of 1997-1999.

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Definitions:

Depository Institutions

Depository institutions are financial organizations, such as banks and credit unions, that accept deposits from individuals and provide loans.

Reserves

Funds that banks use to satisfy the cash demands of their customers and the reserve requirements of the Fed; reserves consist of cash held by banks plus deposits at the Fed.

Acquire Funds

The process of obtaining capital or money to finance operations, investments, or other business activities.

Foreign Exchange Markets

Markets involving the trading of currencies worldwide which facilitate currency conversion for international transactions and investments.